Here are thoughts on three related resolutions. Stay tuned at the end of this post for a rant about the budget.

A005: Adoption of the Budget. Likely vote: UNDECIDED, depends on what the budget looks like.
This resolution simply adopts the budget as finalized by the Joint Standing Committee on Program, Budget and Finance. That won’t happen until General Convention is under way, so the budget details aren’t right here. However, there is a draft budget, as approved by Executive Council. The draft budget is a disaster. Please see below for a rant about the budgeting process (and a few thoughts about the budget itself). Others have looked carefully at this budget, notably Susan Snook (here and here) and Tom Ferguson (here and here). I don’t think it’s worth much scrutiny yet. It’s too broken, a symtom of a completely broken system.

A006: Fund the Joint Standing Committee on Program, Budget and Finance. Likely vote: YES, but not without a grimace.
It would be tempting to vote no on their request for funding, since these folks are the ones who helped bring us a completely broken budget. But it’s not their fault. They are but one cog in a busted machine. So since someone has to work on the budget and it costs money to do that, I’ll vote yes. But see my budget process rant below for why this should cost much less than the requested $100,000.

A007: Reaffirm the Five Marks of Mission for Budgeting. Likely vote: YES.
This is a great way to reaffirm mission criteria in our budgetary thinking. It’s too easy for any organization to get stuck in maintenance mode, and that’s deadly for mission. These lofty ideals remind us what the church ought to be about. Yes, there are other excellent summaries of mission, scriptural and otherwise. But this set is excellent. And Anglican. So let’s keep it before us as we ponder our budget.

A RANT ABOUT THE BUDGET PROCESS
When I attended the Province One orientation for General Convention deputies a few weeks ago, we received a report on the draft budget. I had some idea what to expect, because I had looked at the draft, and I had already had a chance to read plenty of commentary on the internets. What I was not expecting was the way in which the budget was presented.

Here I do not blame individuals, because when you stick a normal person into an abnormal system, that person gets sucked right in. It happens to me, and it happens to you. And it has sucked sanity right out of our budget process.

What are the problems with the budget, you might ask? Here are a few, in no particular order:

It doesn’t add up. Literally. The math is off. That’s not what you expect to see in the budget of a large corporate entity. This is blamed variously on “we were in a hurry and we didn’t have time to check everything” and “when you export Excel to PDF it breaks things.” I am not making that up.

Christian Formation programming was slashed 90% and no one can say why.

The General Ordination Exam was left unfunded, which seems to violate the canons that require the test to be administered. (Hmm, does that mean the various clergy who voted yes on this thing are liable for Title IV violations? Just kidding!)

Some programs inexplicably get an increase, such as the Washington advocacy office. I’m not saying that’s bad or good, but no one seems to know why this one got money and that one didn’t.

Programs are slashed, and staff costs go up. What are these staff going to do? We happen to know some of the answers in a couple of cases. For example, the Presiding Bishop’s office gets a staff increase because of Haiti missioners. But there’s no clarity about most of this.

There’s funding for a development office. While I am head over heels in love with the Episcopal Church, I also know this is not the right time to be doing fundraising for our institution, especially when that development effort is funded by withdrawing principal from the endowment. This could be the subject of another, separate rant.

Just to keep things easy, let’s leave real estate questions out of our thinking in this blog post.

So when all these problems were presented (along with others), the crowd at the provincial gathering had some questions. We were given answers which went something like, “You shouldn’t criticize the process, it just worked out that way. Save your energy for General Convention, when we’ll look at this again.” Or we were told that the meeting at Executive Council was chaotic and there simply wasn’t enough time to fix all the problems. We were also told that after Executive Council had done its work, but before General Convention, no one was authorized to defend the budget or its thinking. And so on.

When there is no accountability, things are broken. Mistakes happen. And in a healthy organization, when mistakes are identified, people try to learn from the mistakes and prevent the errors from happening again. To do that, someone or some people or some circumstances have to be identified as the cause of a problem. It’s not about shame. It’s about doing better next time.

We still don’t know how the budget problems happened. Here’s what I’ve heard.

At one point, people at Executive Council realized there was a math error, and so a large chunk of money was unallocated. People started shouting out amounts for their favorite programs until the money was gone. And so a few programs did well.

I have heard some people blame the staff at 815 for the bad budget data, but I have heard from folks at 815 that the staff was largely removed from the budgeting process.

Unbelievably, we were told that no one knew the Christian Formation budget had been slashed by 90%. It was “maybe” a “math error.”

There was no way to fix the budget once the mistakes were made. One wonders if anyone thought about a conference call or some email.

We were told that when you export Excel to PDF, it breaks things. Seriously. We were told that. As a reason for these problems.

If this was the first time any of this had happened, we’d chalk it up to bad water or something. But do you remember what happened in 2009 at General Convention. For some inexplicable (get a theme here) reason, revenue estimates had to be greatly cut at the last minute. And so with little notice, the budget had to be slashed and dozens of jobs eliminated in one fell swoop. How were the revenue numbers such a surprise? Why had no one prepared for that draconian possibility?

I say all this knowing that people worked on this who are much smarter than me. People with more budgeting experience than most of us had a hand in this. But it’s so bad it would be laughable if it wasn’t distracting us from doing the work the church should be doing. You see, the system itself is broken, and so reason goes right out the window.

Here’s how the budgeting process would work if our system were healthy. General Convention would set big picture organizational priorities. Executive Council would adjust those priorities as needed, making refinements during a triennium. The program staff would prepare a budget based on the stated priorities. Executive Council, acting as the board of the Episcopal Church, would approve this budget, making very few tweaks. There would be no surprises. General Convention — a gathering of 1,000 voting people — would largely stay out of the line-item details of the budget.

If you are one of the General-Convention-must-decide-everything people, then I’ll grant you a review by GC after Executive Council approves the budget, which has been created by staff. However, we should not be holding hearings at which the entire budget could get rewritten on a whim.

It seems to me that some folks don’t trust the staff to create the budget and define their work. The staff feel (rightly so, in my view) micromanaged. The governance/staff pattern of the Episcopal Church is unlike that of any healthy non-profit. And not in a good way.

If the staff aren’t trustworthy, let’s get new staff. If the Executive Council can’t keep its hands out of someone else’s business, let’s train them. If General Convention wants to waste precious time voting on budget line items, let’s remind folks what a colossal opportunity cost there is in doing things this way. Imagine what else we could do if we didn’t spend all our time looking at grass and ignoring the forest.

We’re stuck with this mess in 2012. But let’s take steps to fix it for next time. Until Executive Council knows what its job is, we’ll continue to have this budget mess. Until General Convention sets its sights on greater work, we’ll continue to do things that can be done by others. Until the staff are free to do their thing, we’ll continue to complain about their work. Until we fix the process of allocating resources, the Episcopal Church will continue to decline, missing opportunities to engage the needs of our world.

Where shall we starting untangling this hairball?

P.S. One budget area I happen to know a little about is the communication office, which continues to be underfunded. I’ll say more about that in another post.

6 Responses

So…I thought reading 7WD posts on GC could be a way to educate myself, as since I left the national scene for parish work, I haven’t paid much attention to such matters. Can’t say I’m surprised to agree with Jonathan; like him, I’m with you every step of the way. (And impressed by the clarity of your writing!) But what surprises me is my tears. Like you, Scott, I’m head over heels in love with TEC, and I think my tears are akin to feeling my lover has betrayed me. Seriously. I am weeping over the state of my beloved TEC. And praying.

Here’s the first thing I think is necessary to fix the system: it’s to not think that the budget as presented was acceptable. Maybe it’s different from where you sat, but from a distance, what I saw was that the budget was presented, people got upset about crazy errors and changes, and rather than respond saying, “You know, you’re right,” there were instead rationalizations and excuses–and reasons why this was, in fact, and in some world, a good budget.

And I’m sorry: numbers not adding up=crazy inappropriate budget. Unexplained reductions of funding by 90%=crazy inappropriate budget. Not funding required programs=crazy inappropriate budget. If they can’t see that, we are in deep doo doo.

Great comments, as per usual. This year’s budget is a clear indication of a broken system, and we need to fix the system in order to 1. fix this year’s budget and 2. not have this happen again and again and again.

I also think it’s striking that we will (likely) vote to reaffirm our commitment to the Five Marks of Mission for budgeting, but there is not much evidence that those five marks were considered in this year’s budget. Again, a broken system.

Simply passing a resolution that “reaffirms our commitment” to the 5 Marks of Mission is nice but doesn’t really do much on its own. To truly reaffirm our commitment, we have to embody it in the work of the church, including the budget.

5 Marks of Mission
1. To proclaim the Good News of the Kingdom
2. To teach, baptise and nurture new believers [one of our weakest areas, imo]
3. To respond to human need by loving service
4. To seek to transform unjust structures of society
5. To strive to safeguard the integrity of creation and sustain and renew the life of the earth